The tribunal has "set aside" the penalty order, dated October 27, after hearing an appeal filed by Akash Harishbhai Desai, one of the 22 entities penalised by the regulator for alleged manipulative trading in the shares of Saran Chemicals Ltd during the January-June 2011 period.
The individual penalty amount was varied for entities and was Rs 15 lakh in the case of Hindu Undivided Family (HUF) of Rupani, who took over as the chief minister in August 2016 and is currently heading BJP's campaign for the state's two-phase assembly polls on December 9 and 14.
The appellant and other parties against whom the order was passed have been asked to submit their replies within three weeks from November 8, as per the SAT order.
Noting that the appeal was "taken up by the consent of both the parties", the tribunal said the appellant has submitted that the Sebi order was passed without giving them an opportunity to file their replies and without any personal hearing.
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Soon after the SAT order was made public, Rupani tweeted, "after six years one officer of Sebi passed an order against 22 persons imposing penalty without even hearing anyone of them including Vijay Rupani HUF".
"In 2011, the share broker of Vijay Rupani HUF had carried out only one transaction which is a minuscule part of the total transactions done by several unconnected entities," he said in another tweet.
"Having found that none of the persons against whom the Sebi officer has passed an order is even heard, the tribunal has quashed and set aside the said order," he tweeted.
However, the Sebi order mentioned that show cause notices were to all 22 entities, including Rupani (HUF), on May 6, 2016.
Sebi noted that there was no reply from Rupani (HUF) with regard to the show cause notice (SCN).
The order also noted that medical certificates attached with the June 2016 letter "suggested for rest of 8 weeks to Vijay Rupani from May 18, 2016, however, no reply towards the SCN has been received from it/ him till date".
According to Sebi, Rupani (HUF) had informed it on May 13, 2016 that the CD attached to SCN was damaged.
Another CD was sent to him on May 25, 2016 and he was also informed that in case he was still unable to open the CD then an authorised person can collect the same from office of the Sebi's adjudicating officer with prior intimation.
Rupani (HUF) is among the entities that were found by Anand to have indulged in creating artificial volume rise in the company's shares.
Among the 22, two -- Akash Harishbhai Desai and Ashwinbhai Prabhudas Ruparel -- had indulged in price manipulation while 19 others, including Rupani (HUF) had indulged in "artificial volume rise/ creating misleading appearance of market/ getting unlawful or unfair gain," the order said.
SAT's ruling came on the appeal filed by Akash Harishbhai Desai.
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